Can Coca-Cola's Brand Strategy Change Perceptions?

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Coca Cola has a long and distinguished history of marketing success stories. Its advertising is much of what has made the brand the powerhouse it is today. It has made some huge mis-steps, like the ridiculous New Coke, but, by-and-large, they’ve got it right. Now, however, they find themselves in a tricky spot. While its brand is beloved, its actual product is largely seen in a negative light. The company's flagship drink is seen by some to cause obesity and the foundation of a poor diet, even their diet alternative is viewed in negative terms.

In an attempt to correct this imbalance, they have decided to combine all its variations - Coca-Cola, Diet Coca-Cola, Coca-Cola Zero, and Coca-Cola Life - into one united brand campaign, and replace the ‘Open Happiness’ slogan, which launched in 2009, with the Skittles-like ’Taste the Feeling’. This represents a huge shift in the company’s strategy. Its 30-year old business model, in which each of its different drinks has a different identity and the compete with each other, a model that dates back to the birth of Diet Coke, is out. Now, all of them will share ideas, personality and branding. The company's Global Chief Marketing Officer, Marcos de Quinto, explained that ‘The new campaign is going back to the core values of Coca Cola. We have been just talking about the brand, but talking very little about the product.’

He continued that they had ‘started to talk in a preachy way to people. And Coca-Cola has always been a simple pleasure. The bigness of Coca-Cola resides in this humbleness, in its simplicity.’ It is this essence that the company is trying to get back. One of the key elements of the campaign is subsequently playing up the experience of drinking the beverage, using the kind of emotional storytelling that Coke has long been associated with.

It is also a way of educating people as to the differences between the drinks. Coke’s GB marketing director Bobby Brittain told The Drum that, ‘We haven’t communicated the tastes of our drinks that well and as a result people aren’t making informed choices.’ For instance, five out of 10 consumers do not realize Coca-Cola Zero is a no sugar, no calorie drink. This failure is shown in the sales of its diet products, and the failure of its new ‘healthy’ option, Coca Cola Life. While they remain the top soda brand in the US, in the third quarter of 2015, the company reported just 1% global growth in the Coca-Cola trademark, including 1% growth for brand Coke, 8% growth for Coke Zero and an 8% drop for Diet Coke. In Europe, their revenues fell 7% to $1.3bn, with operating loss up 4% to $722m in the quarter finishing September. Coke Life, in which a third of the sugar has been replaced by a kind of ‘natural’ sweetener called Truvia, was well received when it launched in the UK in September 2014, but has been on a downward trajectory in terms of sales. According to market insight company IRI, just £1.1m worth of Coke Life was sold in November 2015, a drop-off of £2.6m year-on-year. In fact, with the exception of April and May, Coke Life did worse in every month than it had the month before.

The change in strategy represents a huge philosophical shift, and is certainly a bold way to approach a turnaround in fortunes from de Quinto. However, the idea that shining more of a light on the product, when it is the product that is the problem, is a risky move to say the least. Would it work for a cigarette company? Ladbrokes tried a similar campaign, one focused on lifestyle and away from the negative aspects of what it offered, with often counterproductive results and recent competitor ads even basing themselves on satirising the campaign. Coke’s issue is not its advertising, it’s its negative perception in a health-conscious society, and it’s unclear what the new campaign and unified branding does that will change the public's perception of the drink. Short of changing the product altogether, it may be beyond the reach of anything marketing can do.

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